Pension auto-enrolment & NEST


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Pension law is changing in the UK, every employer must offer and contribute into a pension scheme for each of its employees. This short presentation highlights some of the key areas you will come across if you’re an employer as well as high lighting our concerns should you choose to opt for the governments National Employment Savings Trust (NEST) scheme. We are offering you the opportunity to find out which is the best option for you and your business – contact us on free phone 0808 168 0611 or email to find out more.

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Pension auto-enrolment & NEST

  1. 1. clear | concise | advice
  2. 2. The company <ul><li>Bright Thinking was created to provide financial planning advice to: </li></ul><ul><li>Private individuals </li></ul><ul><li>Companies </li></ul><ul><li>We offer a wide range of specialist services that include advice on: </li></ul><ul><li>Personal and corporate investment </li></ul><ul><li>Pension planning </li></ul><ul><li>Employee benefits </li></ul><ul><li>Whole of market mortgage advice </li></ul><ul><li>Protection advice </li></ul>
  3. 3. Our approach <ul><li>The success of Bright Thinking is built on – clear, concise, advice. </li></ul><ul><li>Advice that is: </li></ul><ul><li>Of the highest quality </li></ul><ul><li>Completely impartial </li></ul><ul><li>Tailored to our client’s specific requirements </li></ul><ul><li>Focuses over the long term </li></ul><ul><li>We can provide: </li></ul><ul><li>A full financial planning review or a review of several areas of need </li></ul><ul><li>Advice that is restricted to a single area of need, such as a pension review </li></ul><ul><li>Ongoing advice, reviews and management of arrangements </li></ul>
  4. 4. Service proposition <ul><li>There are four parts to our service proposition: </li></ul><ul><li>The ‘Initial Consultation’ </li></ul><ul><li>The ‘Review and Recommendation’ </li></ul><ul><li>The ‘Implementation of Recommendations’ </li></ul><ul><li>The ‘Ongoing Review Service’ </li></ul><ul><li>Further details of what’s involved in the above processes can be found in our </li></ul><ul><li>client service proposition document, along with details of our fees. </li></ul>
  5. 5. Auto enrolment & NEST <ul><li>What does this mean? </li></ul><ul><li>Auto-enrolment and NEST (National Employment Savings Trust) will start from 1 st Oct 2012 </li></ul><ul><li>Large employers with 50,000 employees or more will be eligible to start from Jul 2012 </li></ul><ul><li>The start date or ‘staging date’ as it’s being referred to depends on how many people are in your PAYE scheme </li></ul>
  6. 6. All employers will have to automatically enrol staff who are: <ul><li>Aged 22 to state pension age </li></ul><ul><li>Earning more than the income tax threshold (£7,475 in 2011/12 tax year). </li></ul><ul><li>Not currently in a qualifying pension scheme </li></ul><ul><li>Contribute at least 3% of employee’s salary </li></ul><ul><ul><li>Into: </li></ul></ul><ul><li>Either NEST, or </li></ul><ul><li>An alternative qualifying pension scheme (i.e. a personal pension scheme or an occupational scheme) </li></ul>
  7. 7. What does it mean for employers? <ul><li>In summary, each employer will be required to: </li></ul><ul><li>Select a qualifying pension scheme for automatic enrolment </li></ul><ul><li>Provide prescribed information on the scheme to their employees </li></ul><ul><li>Identify and automatically enrol eligible employees into the scheme </li></ul><ul><li>Accept ‘opt-in’ requests from other employees to join the scheme </li></ul><ul><li>Calculate and pay at least the minimum employer and employee contributions to the scheme </li></ul><ul><li>Facilitate ‘opt-out’ requests from employees who decide they do not wish to remain members of the scheme </li></ul><ul><li>Refund employee contributions for those who opt out </li></ul><ul><li>Undertake a re-enrolment exercise every 3 years for those who have opted-out, or who have subsequently left the scheme </li></ul><ul><li>Provide prescribed information to the pension scheme and to the Pensions Regulator </li></ul><ul><li>Retain records to evidence compliance with the rule </li></ul>
  8. 8. Our concerns <ul><li>Employers will be fined if their scheme is not set up in time for the ‘staging' date </li></ul><ul><li>The cost and time associated to the employer to set up and run the NEST scheme </li></ul><ul><li>There is a maximum contribution of £3,600 per annum </li></ul><ul><li>There is currently only a small range of funds available </li></ul><ul><li>The choice of funds is heavily influenced by the risk-averse attitude </li></ul><ul><li>It’s the employer’s responsibility to select the fund choice for the employee – if it doesn't then they will be automatically placed into the default fund </li></ul><ul><li>Transfers to and from NEST are not allowed </li></ul><ul><li>We believe this to be a perfect example of low charges = no advice!! </li></ul>
  9. 9. How can we help? <ul><li>We can confirm your ‘staging date’ and advise you when your scheme needs to be in place by </li></ul><ul><li>Ensure that employers can meet their disclosure requirements under the auto-enrolment legislation </li></ul><ul><li>As IFA’s we can compare the NEST scheme to alternative options i.e. a personal pension scheme </li></ul><ul><li>Look at a salary sacrifice model where savings can be made on NI contributions </li></ul><ul><li>We will be able to provide you with a wider choice of investment funds that cover a range of risk profiles, giving you a choice of investment strategies and lifestyle options </li></ul><ul><li>If we set up and administer the scheme we can take the majority of the work load away from the employer </li></ul><ul><li>You will have access to a dedicated pension specialist who you and your employees can liaise with </li></ul><ul><li>As part of our on-going review service we will review the performance of your scheme annually </li></ul>
  10. 10. Contact us <ul><li>Oxfordshire office </li></ul><ul><li>1 st Floor </li></ul><ul><li>36 South Bar </li></ul><ul><li>Banbury </li></ul><ul><li>Oxon </li></ul><ul><li>OX16 9AE </li></ul><ul><li>South West office </li></ul><ul><li>The Old Barn </li></ul><ul><li>Daccombe </li></ul><ul><li>Newton Abbot </li></ul><ul><li>Devon </li></ul><ul><li>TQ12 4ST </li></ul><ul><li>Call our free phone number 0808 1680611 and speak to one of our experts or email us at </li></ul><ul><li>[email_address] </li></ul>